Will Occidental, American Liberty Petroleum and Nevada boom from $150 Oil? (USO, OREO & OXY)

Nevada could be the next North Dakota of Oil

Nov 21, 2011 6:16:37 AM PST | 581 View(s) | No Comment(s) - Post a Comment Rating

Print Email

StockHQ:

USO
$33.13 -$0.41 -1.22%
OXY
$90.10 -$0.43 -0.47%
RDS-A
$67.16 -$0.64 -0.94%
E
$46.16 -$0.66 -1.41%
OREO
$0.02 $0.00 0.00%

A recent front page article in USA Today predicted that gas prices at the pump would be much higher by the spring, certainly no surprise to those following United States Oil (NYSE: USO), American Liberty Petroleum Corporation (OTC BB: OREO) and Occidental Petroleum (NYSE: OXY), among other oil-related stocks.

In an article in Barron's earlier this year, "Get Ready for $150 Oil," Gene Epstein wrote about oil basically doubling in cost by early 2012. Basic supply-and-demand supports this assumption. China, the world's largest energy user, is growing at a rate of over 9% annually. No alternative energy supply has even come close to displacing fossil fuels as an energy source. Oil from unstable areas such as the Middle East and Africa is an unpredictable supply source. Attacks on Royal Dutch Shell (NYSE: RDS-A) facilities in Nigeria and the shutdown of production for Eni SPA (NYSE: E) in Libya easily make this point. All of these factors militate towards the attractiveness of American Liberty Petroleum Corporation (OREO).

American Liberty Petroleum Corporation is based in the United States and drills in the United States. Headquartered in the oil country of California, Bakersfield, American Liberty Petroleum has operations in Nevada. Overall, reports project close to 5 billion barrels of petroleum in the areas where American Liberty Petroleum (OREO) is active.

The "elephant" field is terms of upside is the Gabbs Valley Project of American Liberty Petroleum (OREO). It is situated on the Cobble Cuesta Structure, over 26,000 acres. This area is extimated to represent more than 4 billion barrels of oil.

Potential is great, but reality is what provides long term value. Just ask the San Diego Chargers about Ryan Leaf. In this regard, American Legend Petroleum has its Peyton Manning in Dr. Alfred H. Pekarek. Armed with a Ph.D., Dr. Pekarek has helped establish more than 300 wells. As one analyst pointed out, "That's 300 more than some drilling and geological experts help establish in a lifetime!" Now on the advisory board of American Liberty Petroleum (OREO), Dr . Pekarek performed the preliminary analysis.

Oil was first found in Nevada in 1954 by Shell Oil (now RDS-A). Since then, over 1000 wells have been drilled. By contrast, over 110,000 wells have been drilled in California's Great Central Valley. Occidental Petroleum (OXY), headquartered in Los Angeles, has long been active in California, both on land and off the coast.

Nevada now has nine producing oil fields. Of these, eight are in Nye County, an area of operation for American Liberty Petroleum (OREO). Oil does not come to mind when Nevada is mentioned. But neither was it for North Dakota, which is now booming, as detailed in a previous www.smallcapnetwork.com article, "Is Nevada the next North Dakota Bakken?"